european journal of social sciences issn: 1450-2267 - EuroJournals

European Journal of Social Sciences – Volume 5, Number 3 (2007)
One of the most difficult challenges for the human resource management and planning process
is when the firm is operating in the middle of the transition stage from mechanistic to organic. When
the firm is neither predominately mechanistic nor organic in structure, it literally has a wide range of
designs and structures producing a significant variation in the types of KSAs required of the firm’s
workforce. Furthermore, some firms, rather than transitioning to organic endpoints, tend to constantly
fluctuate between centralized and decentralized decision-making, moving back and forth along the
horizontal range of organizational structure (Roberts, 2004). Human resource managers must have
knowledge of when such transitions are taking place, i.e., what forces are shaping the firm’s
product/service market and the degree to which workflows and work structures are to be altered.
Without attending to this, managers will be applying inappropriate motivation and control procedures
on their employees. This is not beneficial to overall firm performance.
Furthermore, the entrance or exit of new and old competitors into an industry, changes in
political and legal constraints, merger and acquisition actions and the diffusion of major innovations all
serve to change the landscape of certainty and stability facing the firm. This in turn further complicates
strategic human resource planning. Once again human resource managers must also have a good grasp
of the dynamic changes in the competitive environment and how these changes impact changes on the
firm’s structure and design. Good forecasts require contingency strategies for hiring human resources
and the impact on the bottom-line become essential for the major strategic decision-makers of the firm.
Technology
To further complicate issues, another force affecting the derived demand linkage is the nature and
deployment of technology. In the simplistic view of technology, a firm adopts technology to substitute
for relatively high labor costs. However, the effect of technology on the demand for human resources
reveals a more complex set of relationships and impacts.
Some technologies may substitute for certain labor skills while other technologies change and
extend the skill mix of employees. Generally, the adoption of technology changes the quantity, quality,
and mix of labor services in the production process. Understanding how technology impacts these skill
levels and quantities is essential for developing an effective human resource planning process in
support of achieving and maintaining a competitive advantage in the firm’s product/service market.
Galbraith (2002) illustrates some of the changes organizations face in regards to labor skills:
“… Companies in electronics, genetics and pharmaceuticals all search for experts in
specialized fields to push the limits of technology. The level of specialization is actually
increasing, as the new specialties are created everyday. Specialization of high skill
workers allows the talented employees to gain greater expertise in these specific areas.
The expertise can often be accumulated into databases and delivered to the teams by new
information devices. Thus, the expertise not only services its primary purpose of
allowing the specialist to gain in-depth knowledge but also can be disseminated to
educate and inform generalists.” (pp. 18-19)
The effects of such changes also impact low and medium skilled workers:
“In contrast, at the low- and medium-skill levels, several forces are combining to
eliminate highly fragmented tasks. Simple low-skilled tasks are being automated
(machines can do the tasks more cheaply and reliably than people can) or exported to
developing countries. In addition, the costs of coordinating fragmented, interdependent
tasks are too high in rapidly changing situations; a large amount of communication is
needed to combine the work when hundreds of subtasks are involved. The remaining
low- and moderate- skill work is being handled by multiskilled teams of educated
workers. These teams are given end-to-end responsibility to make decisions for an entire
piece of work providing a more rapid and effective workflow.” (p.19)
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